For Immediate Release

May 31, 2018

Statement

Without question, one of the most frustrating challenges that health care providers and patients must contend with is when a drug that’s medically necessary and critical to patient care is unavailable due to a shortage. We know that the uncertainty over how long a drug will be in shortage, how to ration supplies in the meantime, or worse, how to prepare for a sudden event that might place unforeseen demands on a product that’s in short supply, adds burdens and stress on providers and patients.

The FDA also understands that hospitals and other health care facilities can feel blindsided by these shortages. They can seem abrupt, and may be. Drug shortages also have significant costs to our overall health care system. The FDA is committed to taking new steps to address the root cause of more of these shortage situations.

While the causes of drug shortages vary, most shortages are due to disruptions in supply chain availability of actively marketed products. Among these interruptions, manufacturing and quality issues are the leading causes of drug shortages. This includes outdated equipment in need of repair or replacement, unexpected issues with a product’s composition, and a manufacturer’s inability to maintain facility and product quality. The availability of raw materials can also be a key factor in creating supply disruptions. A disruption from one supplier of raw materials can affect production for many drug makers who all depend on that one source of raw material. Companies that supply raw materials can also be subject to quality problems, leading to shortages.

Only 2 percent of shortages are a result of product discontinuation. For example, when companies that make competing products merge, and discontinue one of the competing products, this can cause a shortage. Manufacturers often make production decisions based on business considerations, such as a product’s profitability, manufacturing costs, distribution quotas and patent life. We know that business decisions at any point along the drug supply chain can lead to shortages. Historically, many drugs in short supply have been low-profit generic medications, for which the investment needed to ensure continued production can be less than that for higher profit products.

Even in the absence of any production issues and decisions, there are other issues that can precipitate a shortage.

For example, an unforeseen increase in clinical demand, changes in clinical practice guidelines, or even FDA approval of a new indication for an existing drug, can all lead to an unexpected surge in demand for a particular medicine. The increased demand can, in turn, lead to a shortage of that specific drug.

Given these challenges, the FDA is focused on doing all we can to mitigate existing shortages, and prevent them from occurring. While we help avert and minimize shortages in many ways, the FDA can have the best impact by working more closely with sponsors to help prevent shortages before they occur.

This starts with the FDA knowing about potential supply disruption well in advance of an actual shortage.

The Food and Drug Administration Safety and Innovation Act of 2012 (known as FDASIA) generally requires manufacturers to notify us of any disruptions, such as manufacturing changes, production or shipping delays, and product discontinuations likely to affect their supply of prescription drugs for serious illnesses. This vital information allows the FDA to execute other actions within our authority to help avert impending shortages or lessen their impact.

These notification requirements are critical, but there are many times manufacturers abruptly discontinue, limit, or delay production under circumstances outside those for which they are specifically required to provide advance notice to the agency. There are other times when companies notify the FDA of potential supply disruptions, but don’t provide enough details to allow us to make the fullest use of our resources to address the shortage. We need to know as much as possible about these shortages.

While this information sharing can sometimes be challenging, the more information manufacturers can supply the FDA, the more we can do to help mitigate the shortage. To address these challenges and opportunities, the FDA is exploring additional ways that we can encourage companies to voluntarily share more timely information about potential supply disruptions.

We may be able to take new steps to clarify the information the agency requires to inform us better about the extent of a shortage problem. We’re also looking at what additional steps we can take, under the existing law, to make the communications we receive more actionable. This includes additional information that can help the FDA develop more effective options for managing a shortage.

Our ability to help resolve shortages also relies on industry seeking approval for drugs currently in short supply. When that opportunity arises, we do what we can to prioritize these circumstances. For example, if a new production facility or supplier is needed, we have the regulatory authority to expedite facility inspections and drug application assessments so that the facility can become operational as soon as possible. We can also expedite review of a new or generic drug application that, if approved, may serve as an alternative therapy to a product facing a shortage. Even when a shortage situation is urgent, patient safety remains our top priority. We make sure that any approvals of such alternate therapies meet our standards.

Although we cannot mandate submission of applications for products in short supply, the FDA does alert other manufacturers of similar or alternative products to consider ramping up production to meet an anticipated increased demand for their product. In cases where alternative manufacturing is not available in the U.S., or the manufacturers of U.S.-marketed products are not able to expand production, we may explore importation of a product from a foreign manufacturing source until the shortage is resolved. We carefully evaluate the overseas manufacturing site and product to protect U.S. patients.

We’re also taking steps to bring on new technology that can improve manufacturing, to help reduce the chance that supply disruptions will occur. The FDA has implemented an emerging technology program and established an emerging technology team to engage with companies about new production technologies that could, in the long run, prevent drug shortages caused by product quality and manufacturing problems. One such technology is continuous manufacturing (CM). As with any new technology, implementing CM presents challenges, such as the initial cost of investing in new equipment. The FDA is taking steps to reduce the cost and uncertainty of adopting CM as an important, long-term solution to improve manufacturing reliability. The goal is to prevent and mitigate future drug shortages.

Finally, as we learned from our experience in responding to the devastation in Puerto Rico following Hurricane Maria last year, predicting some forces that can lead to shortages is very hard. Given the complexities involved in drug manufacturing, especially for sterile injectable drugs, problems can arise at any point in the process. When companies are proactive and have backup lines, and facilities and raw material suppliers are prepared for when things go wrong, we can more readily prevent future shortages.

Shortages are an inevitable consequence of an imperfect system. With better planning, we can minimize shortages throughout the supply chain. But, in the near term, we won’t be able to fully eliminate the possibility that new shortages will arise. Meaningfully impacting the structures and market challenges that can give rise to shortages will require more coordination among public and private stakeholders.

We’re evaluating our current authorities to see what more we can do to better mitigate and prevent shortages, including receiving additional, key information from industry when they notify the agency about a possible shortage and identifying all establishments where manufacturing is performed associated with listed drugs and the type of operation performed at each such establishment. It’s essential that we evaluate what additional steps we can take to reduce the incidence and impact of shortages.

It may also require us to work with Congress to re-evaluate our current authorities in these areas. One consideration might be to expand the FDA’s existing authority to require applicants of certain drugs to conduct a risk assessment to identify the vulnerabilities in their drug supply, including vulnerabilities that could cause a shortage, and establish risk mitigation plans to address those risks.

Anticipation, foresight and communication are keys to preventing and reducing the impact of shortages. When a manufacturer provides the FDA with advance notification before production is halted or put on hold, and a contingency plan is put in place, shortages can be more easily mitigated. Without such efforts, shortages will certainly occur at a higher rate and their impacts will be greater than necessary.

To achieve our public health goals, the FDA needs to work collaboratively with industry. The agency cannot require a company to produce a drug, even if it is medically necessary. The agency cannot require a manufacturer to increase production of a drug, and we cannot control how much of the drug is distributed or which purchasers will be given priority. And the FDA has no authority over business decisions that affect the supply of a drug made by manufacturers or other entities in the supply chain.

We must all work together to ensure that the supply chain infrastructure can withstand inevitable and unexpected disruptions. Mitigating drug shortages requires a sustained effort by industry, the FDA, and other partners to return to production levels that adequately meet the needs of patients. We’re pursuing new ways to support industry efforts to identify critical facilities and products and develop such plans.

We’ll continue to do all we can to address these shortages. I’ll have more to share in the coming months.

The FDA, an agency within the U.S. Department of Health and Human Services, protects the public health by assuring the safety, effectiveness, and security of human and veterinary drugs, vaccines and other biological products for human use, and medical devices. The agency also is responsible for the safety and security of our nation’s food supply, cosmetics, dietary supplements, products that give off electronic radiation, and for regulating tobacco products.